Telstra public Wi-Fi could quake competition: IBRS

The possible announcement of a public Wi-Fi network by Telstra would “put a stiff cold breeze up the competition,” according to an IBRS analyst.

Various national newspapers are reporting that Telstra CEO David Thodey will tomorrow announce a national public Wi-Fi network.

The network will reportedly bring Wi-Fi service to all Telstra customers across Australia, but details are thin on precisely where the service will be accessed and how it will work.

Thodey is scheduled to speak tomorrow at noon at the Museum of Contemporary Art in Sydney. While Telstra did not disclose the subject of the speech in its invitation, the telco claimed it was a “significant event”.

Telstra has declined to comment further in advance of Thodey’s appearance.

“Telstra has the resources to do it but to do it will be costly and take some time. It will make them a far stronger offer than any other player in the market, should they accomplish it.”

“The financial analysis may show it’s not really worth it over most projections but that a few Wi-Fi areas around the country work as marquee marketing,” Cranswick added. “Or it may not progress beyond the announcement but it does put a stiff cold breeze up the competition.”

In theory, providing Wi-Fi spots to customers could help to offload data from the Telstra mobile network and potentially reduce network congestion. The Australian Mobile Telecommunications Association (AMTA) has frequently pointed to surging demand for mobile data as putting increasing pressure on telcos’ mobile networks.

“Carrier grade Wi-Fi network had long been known for offloading mobile data traffic, but more importantly it establishes a strategic services platform for carriers to deliver location-based services and enabling enhanced customer analytics,” Telsyte analyst Alvin Lee said.

However, Lee said it remains unclear which Telstra customers will be able to access the Wi-Fi network and what it will cost if anything.

"It does make sense for Telstra to augment mobile broadband capacity with Wi-Fi, especially in areas of high demand," said independent telecom analyst Chris Coughlan, cautioning that it has not been confirmed what Telstra is launching.

"For it to be effective customers would roam between mobile broadband and Wi-Fi with the mobile core network authenticating and managing the user's connection. Once set up, customers should have a continuity of service and experience regardless of how they are connected to the network."

The possible announcement would also come at a time when telcos are struggling to make money selling mobile broadband services for tablets and laptops.

A report released earlier today by Telsyte found that Australia’s mobile broadband market has stagnated in part due to an explosion of Wi-Fi hotspots, with telcos currently only able to monetise 20 per cent of the consumer media tablet market.

Public Wi-FI hotspots are “sprouting like mushrooms and are now widely supported by local councils, shopping centres, local businesses and increasingly our transport networks,” Lee said.

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